Alternative Technical Templates

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649

If you can wrap a workable plan or strategy around something which you’ve unearthed & tested sufficiently across a long enough timetable and varied trading conditions, then I guess you’re ‘good to go’

Personally, I don’t look for anything other than what works for me. I have a couple tried & tested set-ups for one or two repetative trade conditions which suit my particular aims-expectations for that specific occurance.

It’s then a case of waiting until the potential trade comes to me.

You have to find that which suits your style & psychological well being. As long as you can justify laying your $$'s down & you got your risk & defenses sussed, then you’ve covered your bases.

Doesn’t really matter what anyone else thinks. They’re not you! :wink:

650

Thanks Tess, I appreciate the input.

I am trying to wrap a plan around this phenomenon but so far I find it a little unpredictable. Im still running my stats on it to figure out a tradeable way.
I was just wondering if anyone else has discovered this and wanted to know if theres a reasonable explanation to it. The other thing i discovered is that its not effected by the asian session at all! no matter what the previous trend this decline is there at 95 % of the time. At this point I am using it to decide on ambigous situations for te 15mTF trades ( doji formes near s&r zone edge b4 above mentioned time etc…). So right now it really is just one of my tools but when things are set up it can come pretty handy.
I will share my results on this if I get further on

Oh, and great thread! keep up

cheers

664

Just to add: the 15m graph highlights clearly the trappy & risky option of triggering a “long” in this current zone.

By hesitating & dithering, those considering executing “longs” are merely being sucked into a possible supply handover up here at yesterday’s highs, ahead of the stronger resistance 50-70 pips higher up.

The lower risk “longs” farther back off the higher low leg (at c204.50) at least have a little breathing room to fold their hands if this 1st line resistance zone fails to break.

It’s all about handling & managing risk.


665

And the traps won the day…

This 15min graph into the London close capturing the day’s events confirming no demand whatsoever on this pair to drive prices up thru the ceiling at y’days highs.

If you look at the construction of the 4 hour bars down here over the past couple day’s, you’ll see a little clearer the strength & intent of this minor s&r zone. Bears very much in control of this gig at current levels.

Confirmation & assurance (via the bar prints at resistance) that shorts continue to hold the value card on this pair.

Looks like we’ll once again get to taste the flavor of the potential demand back here at the 203.50 floor.

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668

Thanks,
Great posts.I guess what I am confused with is what will be our take action plan with this?What excalty are we looking for to say OK here it is lets push the trade button.Becuase I felt earlier (on my post with pics)That we were getting a trend reversal.It was looking as it was going to change.but did not.I know you want to get in early on trades to lift up your R.So where is this fine line drawn?between to early or to late?



669

I think Josh you are looking for certainty where it doesnt exist. Here is my H1 GY chart. The question is do I want to play short off 205.75, long off 203.45, both or neither. If I want to play at all what is the tightest entry I can get. There are limitless entry triggers but you should as you know have 1 or 2 you know real well. Currently I could execute short off the 78.6 retrace area stop above the swing high, I could wait for an inside/outside bar and execute off that, I could take a punt and short off any rejection bar occurring on the 205.75 area. In fact step 1 is to wait for the tokyo open, see what happens to shares in Asia and Australia. There is no rush and if this does suddenly move and I am not on the bus so what. My bias is to further downside so I would like to get positioned now if possible but we will see

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688

When trading using support and resistance lines, would it be best to execute your trades based on the particular trigger your using on the lower timeframes?

689

It’s entirely your call George. If you’re plotting a s&r line or area from your 4 hour or 1 hour reference, then price is going to react & move away from it at some point, yeah?

Price doesn’t distinguish between a 240min chart and a 1min or tick chart. Only we recognize the differing timeframe references. Price will simply make it’s footprint & carry on regardless.

If you possess a trusted & tested set-up or trigger which signals you in via the 1min or 5min chart at or on a hard support & resistance level, then as far as your trade plan is concerned it’s a valid trade.

691

Hi all,

As a novice who’s trying to learn and work at the same time, I don’t really have much in the way of advice to give or experience to share, which is why I’m an infrequent poster, but an avid reader - the regular posters on this thread have really improved my learning curve. Many thanks.

Anyhow, after my first 10 weeks seriously trading using the basic tenets in this thread, I finally have some feedback to share. Whether it’s useful or not, I don’t know.

So what have I found?

I’ve found I’m not a natural at this game. Luckily though, as a freelance writer, I’m able to work my trading around my real job, so it doesn’t really matter that I’m not going to make my fortune trading (or writing :slight_smile: ).

My goal, at the start, was to achieve an average of 2R per week. A reasonable goal, I think. And at the end of my first 10-week yardstick, I managed a bit more than 1.5R per week. Hardly brilliant, but not bad. I’ve made back the money I spent on books and experimenting and generally making mistakes previously.

My worst run was two consecutive losing trades.

I averaged 4 trades per week (I only focus on GU, EU, EY and GY), although I missed quite a few due to my aforementioned real job.

I had more winners than losers (25W, 10L, 5BE).

And in retrospect, like so many other newbies, I exited my winners too early, so I think I need to pace myself better, which will no doubt mean forfeiting my more-winners-than-losers stats.

Interestingly, I found that divergence increased my success rate remarkably (of my 25 winners, 17 had divergence as confirmation at an S/R level).

Likewise, when an S/R level was on or near a 00 level and displayed divergence, the success rate improved again. No surprises there then - the more confirmation, the higher the probability of success. Duh!

And that’s about it. Hardly earth-shattering results and no real insights beyond what Tess, Tony, Jocelyn, et al have generously shared, but hopefully some encouraging proof in the pudding for other novices like me.

Think it’s time I shut up now :eek:

692

Congratulations Mr Average. That�s a pretty impressive set of stats to be going on with.

If you can maintain that degree of progress throughout varying market conditions over a longer period of time, then you won�t have too many complaints.

Whether you realize it yet or not, much of your initial success stems from the discipline displayed in your trading strategy. You�ve unearthed a method of market observation which suits your style & psychology. More importantly, it�s based around simple, repetative market behaviour. That kind of sensible market observation sure makes life a lot easier when attempting to deliver a trading plan which stands a chance of delivering ongoing profit.

you really now need to continue with it over a longer time period to satisfy yourself that it works for you & it also stands up across a selection of differing market conditions.

As long as you stay loyal to your risk (account protection-money management etc) parameters then you�ll be better placed to judge the potential longevity of this particular strategy play.

If it holds up to that consistent measure, then not only will your confidence in applying it increase, but it will also save you an awful amount of (lost) time hopping back & forth amongst the crap & crud masquerading as �trading system gold dust� out there.

If the next 10 months matches the first 10 weeks, then you’ll really have something to begin getting excited about :wink:

Keep the discipline going & enjoy yourself…& keep everyone posted on your progress. :slight_smile:

694

Thanks for the encouragement and advice guys. I feel like I�ve made progress, thanks in no small part to your posts, but I�m keen to maintain it. In the short-term I think that means learning to manage winning trades better, as I mentioned.

I think this is more of a psychological hurdle than anything else. For instance, I�m now comfortable exiting losing trades at my pre-defined stop without a second thought, and without affecting my approach to the next trading opportunity, something I struggled with last year. Now, I think I need to apply the same pragmatic approach to staying with winning trades for longer � at the moment I seem to find reasons to take profits earlier than I intended, even when I know I shouldn�t. So that�s my next goal: to get into the habit of setting pre-defined profit targets (like my stops) and leaving them where they are.

695

If that’s the only major hurdle in your armoury thus far, then you’re sitting pretty.

Obviously, you’ll do what feels more confortable to your aims & expectations etc, but I’d be careful about adhering religiously to pre-defined targets.

What that process does is instill rigid parameters into your strategy model & we all know that markets don’t dance to our tune, neither do they play out where & when we want them to.

You could set your profit level at say 60 pips for 1st pare off & price nudges 52 pips before falling back & hitting your stops?

What you gonna do if that scenario begins to (regularly) play out??

Would it not be more potentially productive to trail your initial (profit) stops behind a technically relevant move up or down on your chart template?

That way you can pare off at a convenient technical level on the move if you’re trading more than 1 lot. The remaining lots can then be trailed to a specific bar count, or technical level to test the intent of the entry-price move.

Just a suggestion.

But it would definitely pay you to explore those options before rigidly applying a set procedure to your strategy. It can be dangerous from a psychological viewpoint to allow your mind to adopt a principle which doesn’t afford a degree of [I][B]flexibility[/B][/I].

Markets are fluid, uncompromizing animals. They ignore rules & don’t recognize orderly behaviour.

Your strategies must allow for the unexpected & plan for the unknown :wink:

696

More excellent suggestions Tess. Much appreciated. I hadn’t considered trailing my stops. Definitely something to think about.

I guess I should’ve explained how I’ve been managing trades before using a word like “pre-defined.”

At the moment, I only enter a trade if there seems to be a relatively clear path to 1R, at which point I take half off the table. Also, when initiating the trade, I try to identify likely profit-taking points (turning points - based on previous price action - as well as 50 and 00 levels, as opposed to a rigid fixed pip count. And that’s where I run into trouble. Once I’ve taken my 1R half, I start looking for faults in my profit-taking points and find reasons to take the next portion early, which knocks on to the next portion, and the next.

Before I know it I’m all out or down to my last portion, watching the price hit the areas I’d originally earmarked to take more off the table. And feeling pretty daft. :o

697

Mr A you are an inspiration to me. Ive been messing in fx for 2 years but only the past month have i really been getting serious in my trading. Im still trying to define my own system and like you I work. In an ideal world I would be able to stay in front of the charts all day. How did you decide on your rules? Also Does anybody have any good advice for me in helping me define my trading rules. Tess,Tony, and Joceyln you guys have been a big help to me so far.
Many thanks, John

698

The “running your profits” part of your trading plan will iron itself out as you become more experienced & familiar with your strategy.

A good deal of those types of quirks can be attributed to confidence. The more you play to your rules & the more consistent you become, the easier it will be to implement that specific element of your plan.

At the moment you’re still in the honeymoon stage. You’re seeking confirmation that your tactics actually work over the mid term. That’s natural & can’t be rushed. Just take your time to ensure you’re engineering the entries in accordance with your research first.

Once you get your triggers, set up’s & risk management sorted, you can then turn your attention to aspects of your exits & profit management.

I agree with Tessa, it appears you’re constructing a template based on sound & sensible principles. They’ll hold you in good stead going forward.

705

Wont let this thread slip to page 2 :slight_smile:

So anyway, I just finished reading all posts… for the second time, and wanted to say thank you for all who have participated in sharing ideas. I can only join Mr A. in pretty much every thing he said. Im a rookie in forex too and with the information gathered form the thread i managed to get about the same results he did. My money management is slightly different but the rest of the methods is identical. Thank you all again, very impressive and valuable thread you have put together.

Keep up!

706

Good to hear, Harry.

I was just wondering if any of the thread’s protagonists would be able to comment on something I’ve been thinking about. As I mentioned, I found that divergence improved the win/loss ratio, as did S&R entries on/around the 00 level, so I was thinking…

Would it make sense to weight your trades according to how much confirmation you identify. You know, 1% on a trade that meets your minimum requirements, 1.5% on a trade with additional confirmation, 2% on an entry with more confirmation, and so on. :confused:

Not sure if it’s a good idea, and if it is I’m sure it’s not an original one, but any thoughts or ideas would be appreciated. I’m not particularly mathematically minded, so feel free to shoot holes in what I’ve written if it’s rubbish.

707

Why not just trade the entries with all the confirmation and keep your win/loss high. That way you can afford the 2% risk without excessive drawdown.

710

I guess that’s the logical conclusion.

I suppose I was thinking that, assuming your basic/minimum requirements to take a trade are profitable in the long run (without whatever you might consider as additional confirmation), then you’re assured of a positive outcome (well, as assured as you can be given past performance). And if that were the case, and you then weighted trades with additional confirmation with a higher percentage of risk, wouldn’t that be a good thing?

For instance, say I identify my S&R zones and the dominant trend, wait for an IB or OB trigger, as well as divergence with stochs. That’s my basic requirement and, based on past experience, I’m happy that this is enough to be profitable. However, say I also noticed that on the rare occasions when that basic set-up occurs in conjunction with one of the higher level fibs, the likelihood of success is even higher, wouldn’t it be wise to put more behind those rare once-in-a-blue-moon trades when everything lines up?

I’m talking rubbish again, aren’t I?

711

No you are not talking rubbish at all. I would simply say that the longer I go in this business the LESS I look to trade and the LESS trades I take. My profitability though has increased. My aim is exactly as jimmymac says a handful of trades per week. Of course your suggestion is rational just make sure you are not at any time diluting trade quality for the sake of trading